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It’s time to recognize the current economic condition for what it is: the Bush Depression. While some claim it’s not as bad as the Great Depression, it’s another in a long line of capitalist failures and could get much worse.

It’s time to recognize that there’s a crisis in capitalism, and that corporate policies are a failure.

Naming the depression after Bush may be a little unfair, because he was not responsible for instituting all the policies that began with Ronald Reagan. He did oversee the triumph of GOP policies and push the rising power of corporations to create the disaster. Republican policies, along with assistance from pro-corporate Democrats and bipartisan corruption, led to the depression: low taxes, less regulation, a relentless push for the globalization of finance, loose money policies, shipping manufacturing to China, and blind faith in “the market” and “free enterprise.”

Big business panicked after the youth rebellion of the 1960s attacked capitalism, and it began pumping money into a campaign to promote free enterprise. The Republican Party became a convenient vehicle for propagandizing this faith, and numerous corporate-financed groups, including the Business Roundtable, the American Enterprise Institute, the Trilateral Commission, the Chamber of Commerce, the Hoover Institute, and the Heritage Foundation, grew rapidly.

The oil and gas industry-based Koch Brothers, for example, are among the wealthiest people in the country. They have business operations in 45 states, finance right-wing groups like Americans for Prosperity, and contribute to 85 groups that: fight climate change, reject collective bargaining rights, oppose Wall Street reform, seek to defeat healthcare reform, etc. The Kochs and corporations promote policies to privatize public resources, maximize profit, create new sources of income, control information, centralize financial decisions, eliminate all barriers to trade, and extend U.S. military power around the world in support of corporate domination. Not including government lobbying, their foundations easily outspend trade unions and liberal groups. Today they are abetted by propaganda outlets such as Clear Channel, Fox News, and the Wall Street Journal.

Money spent on shaping the public debate and public policy doesn’t include the $30.1 billion over the past ten years that corporations spent to lobby Congress. Additionally, the upcoming 2012 elections will run over $8 billion, mostly donated by corporations.

Despite their efforts to shape public policy, corporations could not prevent the largest crisis in capitalism since the Great Depression. By relentless pursuit of their goals, they ran up against several limits that are not going away. The problems include a surplus of capital and a surplus of labor. Corporations are sitting on $2 trillion in cash that they can’t invest because they can’t sell their products: People who borrowed too much and overleveraged during the Bush years simply don’t have any money.

Capital seeks the lowest-priced labor, and today globalization opens the whole world to exploitation. Every undeveloped country can now provide cheap labor, except there’s no demand. On the other hand, corporations need to invest capital to make a profit. Unfortunately, when they shipped jobs to China, they discovered that the Chinese save money rather than spend. The Chinese loaned their savings to the U.S., which allowed Americans to overspend, overleverage, and overinvest. This created a classic bubble. Now it has burst; there’s no way to hire all the surplus labor and there’s an oversupply of capital. Capitalism is deadlocked.

People are angry. The bottom 50 percent of income-earners own less than one percent of the country’s wealth. The rich doubled their share of national income over the past 30 years, and the top one percent now own 83% of all U.S. stocks. The number of poor people is at a 15-year high, and the middle class is shrinking. Banks now own more housing than all individual citizens combined. Some 61% of Americans live from paycheck to paycheck.

Obama saved capitalism by bailing out the banks, but there was no reform that would prevent the same thing from happening again. Republicans oppose every Obama policy, downplay the central role they played in creating the depression, and pursue the same policies that created the downturn: low taxes and no regulation.

The outcome of the current political situation could be dangerous for democracy. Some 1,000 right-wing paramilitary, nativist, patriot, Christian Identity, anti-government, and white supremacist groups are stockpiling weapons. Angry over losing their social status, far-right conservatives formed the Tea Party, which gained power in Congress, and uses it to filibuster legislative solutions. Meanwhile, also inflamed by increasing poverty, the largely peaceful, middle-class Occupy movement is taking to the streets. Orchestrated attacks against it could foster a backlash.

Economic uncertainty and hate-mongering politicians contribute to an atmosphere of fear in which anything could happen, and some wonder if violence can be far behind. In any case, it’s worth heeding the warning that when the disparity between rich and poor grows to the extent it has in the United States today, empires fall.

Comments

I'm not sure if this article is satire or simply stupid. I am sure it is the kind of partisan drivel that insures we're never going to get out of this abyss. "Obama saved capitalism..."? The first bail out came from the Bush White House. Dem's changed the rules for home lending to create a false pool of buyers that could not afford homes in order to create a false economy. Bush simply followed their idiotic lead and then destabilized the world with his moronic wars(which the Dem's fully supported with their votes).

I think the out of control (lack of effective regulation) wall street speculators and cheats gambling with derivatives of derivatives caused the crash, not the Community Reinvestment Act (CRA) attacked by Rush Limbaugh. The CRA was to enable first home buyers in cities to prevent landlord ghettos. Most of the improper loans, made by entities like Countrywide (bought by Bank of America), were for highly overpriced homes in suburbia. But again, it was the exponential gaming by the large financial corporations without any moral standards that smashed the economy. Congressional lackeys of those corporations are the enablers. Occupy the Goldman-Sachs and the Senate!

Great article and wow it's just amazing how some people refuse to even look at the facts (as succinctly presented here.) Thankfully they are the Minority and hopefully we can at last turn around from the disaster collision course the Reagan administration put this country on.Apologists and ideologues can smugly comment from the dustbin of history. The rest of us are moving on to the future, which is now.

Thirty years of deregulation, tax cuts, corporatism, and militarism has been an epic failure. All of our good jobs have been exported to countries that allow slave labor. This is what "good old conservative values" have given us. Even average conservatives have been betrayed by their leaders. It's time for a paradigm shift.

italiansurg - I agree with you that Bush bailed out the banks, not Obama, but disagree with you on everything else.

"Insane Levels of Leverage by the Too Big to Fail Banks – Not Deadbeat Borrowers – Caused the Financial Crisis The Cause of the Financial Crisis: Fraudulent Creation of 3,000 Times Leverage On House Prices by the Big Banks

We’ve repeatedly noted that fraud by the big banks – more than anything done by the little guy – caused the financial crisis.

And we’ve repeatedly noted that excessive leverage helped cause the Great Depression and the current crisis.

Reader McFid – who has been a breach of fiduciary duty expert since 2003 – sent me the following article (edited slightly) which provides a new angle on both themes.

This article disabuses the notion that “deadbeat borrowers” caused the financial crisis."

Economic racism is a slippery thing in 2011. It's not out in the open, like a "whites only" sign above a lunch counter. And it's not explicit, like the deed to a house barring its sale to blacks or Jews.

Instead, it's submerged. It lives in patterns of discrimination hidden within reams and reams of hard to analyze data. It's not necessarily driven by animus or hate. Sometimes it's just a product of garden-variety greed.

For proof, direct your attention to the record-setting settlement announced this week between the Justice Department and Bank of America over the mortgage lending practices of Countrywide Financial. The bank agreed to pay $335 million dollars to settle claims that, at the height of housing boom, Countrywide routinely discriminated against blacks and Hispanics by charging them higher interest rates and fees than equally qualified white customers.

The 45-page complaint that accompanies the settlement may be one of the most extensive studies of housing discrimination ever completed in this country. The court papers outline what Justice investigators found when they analyzed 2.5 million mortgages Countrywide issued between 2004 and 2008. Bank of America, which bought the enormous mortgage lender in 2008, has not admitted or denied any of the government's alleged facts.

Here is the ugly story made brief. According to Justice, Countrywide overcharged more than 200,000 black and Hispanic borrowers for their loans. About 10,000 were sold risky subprime mortgages, even though their finances were good enough to qualify for cheaper prime rates. Black customers who obtained their mortgages through a Countrywide-affiliated broker were more than twice as likely to get a subprime loan than similar white borrowers. In some markets, they were as much as eight times more likely.

Great article, that is of course if you are able to free your mind from partisan "drivel" and understand that Capitalism by those who know is now called "Vulture Capitalism" and plays well into Lenin's quote "When it comes time to hang the capitalists, they will sell us the rope".

In this day and age you are either able to recognize that the "Rulers" control the dialogue; the left/right, divide and conquer paradigm and it is not left or right it is "us" (everyone) against "them" (the rulers).

Understanding this paradigm should be an awakening unless of course you are brainwashed by ideology and support the rulers against your own self interests.

Yup, if only the fabulous Dem's had any power over the past 30 years this would never have happened! Oh, they did from time to time and went along with the Repub's? Oh, you mean that Obama and the Dem's controlled everything for two years but did not begin correcting the mess even though there was a veto proof majority? Never mind...contactjohn and I agree that the entire mess is a crusade against all Americans, regardless of political affiliation. As leaders from both parties were/are getting rich off of inside financial information, partisan sycophants were/are blaming "the other guy" while the collective group of politicians openly laughs at the whole lot of us. We are totally screwed, dudes and dudettes, if we keep thinking this is a partisan issue and cherry picking "facts" to bolster an ideology.

Ten years ago, the banks were called "racists" because they didn't lend to people in minority neighborhoods. Now they are called "racists" because they DID lend to people in minority neighborhoods. I guess no matter what they do, they are still "racists".

Hey Botany, stop upsetting the mix of Progressives vs realists in these posts. If any more people like you jump in with common sense SB may lose it's standing along with Berkeley, Boulder, and Santa Monica as centers of social engineering nirvana.Actually, part of the mission of the Clinton White House was to increase the percentage of loans to minorities, so they actively changed how debt is accounted for in order to accommodate the increased percentage of defaults by the new minority borrowers. This is neither a mystery nor rocket science.

Provisions of the 1933 Glass-Steagall Act that prohibit a bank holding company from owning other financial companies were repealed on November 12, 1999 under Clinton by the Gramm–Leach–Bliley Act. The repeal effectively removed the separation that previously existed between Wall Street investment banks and depository banks. This repeal directly contributed to the severity of the Financial crisis. In an effort to increase home ownership Clinton also greatly increased the amount banks can loan based on their deposits. These 2 changes created tons of money to lend and legalized self dealing. Certainly GREED played into it, but the bankers were handed a loaded gun!

"Oh, you mean that Obama and the Dem's controlled everything for two years but did not begin correcting the mess even though there was a veto proof majority?"--italiansurg

In actuality, here on Planet Earth, that is not true. Not only did the Dems not have a veto proof majority, they did not even have a filibuster proof majority - when the Blue Dogs are placed on the proper side of the aisle.

False premises lead to faulty conclusions. A little truism demonstrated once again by italiansurg.

So the Dem's HAD control but COULD NOT control their own majority members?Are the Blue Dogs bad under your free wheeling out of control big tent? Are the Progressive ideas so fabulous and compelling that you cannot even get members of your own party to vote for and support them?So, the basic premise was that the Dem's had control but are so out of control they cannot even control themselves still holds true. How the hell can this group govern a country if they can't even govern themselves?

This is not an endorsement for Republicans so don't start answering questions with questions or bringing up Bush. Bush was "not allowed in my house". No radio, TV, newspaper, you name it he was banned.

Anyone that says Berkeley is one of the most desirable places to live is either an Occupier or as schizoid as half of the folks on San Pablo Ave. Take a leisurely drive up University Ave to campus, kind of like lower State on steroids x100, then report back about how wonderful it is...To end your field trip, go dodge bullets in Berkeley's immediate and contiguous neighbor Oakland and then report back if you're not dead or take a field trip to their neighbor to the north, Richmond, if you don't like Oakland style gang violence...I do shop at the Monterey Market though on the north side up out of the flats, sorta like a giant Tri County Produce and without the political correctness of the Berkeley Bowl.

It's not that Republicans oppose Obama's policies, they simply oppose Obama. Poster child for that is the so-called SS tax holiday, which, as originally proposed by Obama to be extended by a year, was opposed by the Republicans, then, when modified to be a mere two month extension they opposed that and said it should be for a year! Damn you, Obama, can't you just get it right? No, by definition, you can't.What seems to be lost on Republicans is that you can't create wealth without a functioning infrastructure. Ours is crumbling, and is way out of date even when functional. This can only be remedied through government spending and appropriate taxation to cover the spending, which pumps money into the economy creating demand. This sudden fretting about the deficit would be comical if it weren't so tragic. Deficits are natural and necessary - it is the only way to create wealth unless you have a positive trade balance (which historically we don't). Japan's deficit is four times what ours is relative to the size of their economy, yet they provide health care for all and an incredible public transportation infrastructure, for example.We can do better.

italiansurg - the only thing that controls politicians is money and re-electability. Both Dems and Repubs have the same problem. And it is why the congress will not work until money and lobbyists are taken out of politics.

This is a democracy - no congress critter should be "controlled". They are supposed to represent the people who voted them in. That is why there are both RINOs and DINOs. DINOs - where a Dem is elected to a strong Republican constituency and vice versa for RINOs.

Please explain what your definition of a DINO is? Is that someone that is a Democrat when YOU agree with them? Amazingly you sound like your counterparts on the extreme Right. Such a big tent you've created; except if you disagree go stand out in the rain... This is why there is such a rift in the Dem party as Obama seems to want his agenda, often contrary to the majority of Americans and without the support of his party. The Progressive arm has abandoned liberalism and lost the center. And if you cannot control your own party when in power then we are in serious trouble. Perhaps you would prefer anarchy and zero control?Also, I apologize for being well informed, I'll try and be more "Progressivey" in the future instead.

Deficits are normal and healthy and necessary although I would not use Japan's extended malaise to make a logical point. The non ideologues have been in favor of extending the debt AND cutting waste AND raising taxes vs the Dem's "cutting" based upon a growing economy and winding down the war and the Repub's refusal to even consider specific tax increases. This is not a Hobson's Choice.. Unfortunately our Congress has universally been out for themselves and their own constituency to the detriment of the country.

Hank and KV-can I bring my electric skateboard(a beast from the boys in socialist Santa Monica, and my unicycle) once the new rules are enforced? My wife will bake biscotti.

KenV: "Hank and I are gonna abolish automobiles and make skateboards mandatory."

I kind of think we already did that in a weay, w/ bikes included in the mix, just try to get across Pardall in a car during the hrs. of 8:00am to 6:00pm. The only word that comes to mind is IMPOSSIBLE! Bwahahahahaha!

Italiansurg: "Hank and KV-can I bring my electric skateboard(a beast from the boys in socialist Santa Monica, and my unicycle) once the new rules are enforced? My wife will bake biscotti.

The electric skateboard sounds cool, could be public transpo depending on the motor's power rating. The unicycle is definitely welcome as well. As for the wife's biscotti, homemade is always the best! By the way, which boys from socialist SM? Rip City Skates? :) henry

SuzIe: "Yeah, the web master is a bit of a prude. Either that or the Powers That Be at the Indy have him/her on a tight leash."

Nope, it's called fair play (as much as I hate the word "fair" because it smacks of communism & like a socialist utopia, it just doesn't exist).Funny how "progressives" cheer when realists get their posts deleted, but are the 1st to cry "CENSORSHIP!" or call the webmaster a "prude" or claim they're on a "tight leash" when their posts get the axe.I've had some posts deleted, even got a message about the wording, but never cried foul. Oh, that's right, I'm not a "progressive" so whining's not my MO :) henry

Great post, Hank. To bad it doesn't apply on Planet Earth. I cannot remember a single person - much less a "progressive" - who "cheered" when a post got deleted. But do keep tilting against those windmills...they're bloody dangerous, ya know.

Hey SuZie, you're stuck on Don Quijote, let it go for a while, like your comments, it gets tiresome. YAWN!Now get yourself back to Earth, the lack of O2 is apparently having an effect on your lack of smarts.Oops, my bad, nope, that's just the "progressiveness" in your genes. Just another day in utopia! :) henry

Capitalism because of democracy and a roll away from the republican form of government we were formed to be. Too many government entitlements and not enough common sense, President Obama says that you need someone looking out for you. Why can’t you look after yourselves? Why is it that the people that own stuff and have jobs are taxed for things they don’t even use? There is no evidence, based on this article, that we get a return on our tax dollars. That President Obama is making sure that someone is indeed looking out for you. It’s a trap, you are dependant and he knows it.

very,very, funny...but please, don't paint yourself into a corner with such a damning stereotype that will ruin your self esteem and victimize you for perpetuity(can dolphins paint? does the ocean have corners?)